UK Exchange Smarkets Eyes Both Prediction Markets and US Sports Betting
British exchange Smarkets is pursuing a dual strategy in the US: competing in prediction markets while also seeking sportsbook licenses in individual states.
As Washington's approach to prediction markets remains unsettled, a seasoned British exchange is betting it can win on two fronts simultaneously. Smarkets, a London-based peer-to-peer betting exchange with more than a decade of European operating experience, is making a calculated push into the United States — pursuing both the emerging prediction market space and traditional sports wagering licenses on a state-by-state basis.
The dual-track strategy is notable precisely because most players in this space tend to pick a lane. Prediction markets — platforms where users trade on the outcomes of political, economic, and other real-world events — occupy a legally ambiguous zone at the federal level, distinct from sports betting, which is regulated individually by each state following the Supreme Court's 2018 Murphy v. NCAA decision. Smarkets is attempting to straddle both worlds, treating each as a complementary revenue stream rather than a binary choice.
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The regulatory uncertainty at the federal level is a central variable in this story. Without clear federal guidance on whether prediction markets constitute gambling, securities, or something else entirely, companies operating in that space face meaningful legal exposure. Smarkets' decision to simultaneously pursue state sportsbook approvals suggests the company is hedging — building a compliant, licensed foundation in sports wagering while the prediction market question works its way through regulatory and potentially judicial channels.
For US consumers and observers, the Smarkets entry signals that international operators with established exchange-model infrastructure see a genuine opening in the American market — one that legacy sportsbooks, built on a traditional house-book model rather than peer-to-peer trading, may be slower to fill. Whether regulators at the state and federal level will ultimately accommodate this hybrid ambition remains the defining question.
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